The company, owned by private-equity firm Triton Partners,
plans to issue five-year payment-in-kind toggle notes through
its Bilbao (Luxembourg) SA unit, according to a person familiar
with the matter. The average yield on junk-rated corporate bonds
in euros fell 3 basis points to 4.5 percent, the lowest since
May 30, Bloomberg bond index data show.

Private-equity firms have raised a record $18 billion of
junk bonds in Europe this year to finance buyouts, as borrowing
costs hold close to record lows and falling default rates
reassure investors. That’s boosted demand for higher-yielding
and riskier PIK notes, which allow borrowers to repay lenders
with more debt.

“We hate leverage going up, we hate supply going up, we
hate defaults going up and none of those things are happening,”
said John Pattullo, who manages the equivalent of about $4.7
billion as head of retail credit at Henderson Global Investors
in London. “We’re not super-bullish but it’s hard to be
bearish.”

The trailing 12-month default rate for European companies
fell to 3.3 percent at the end of September from 3.6 percent a
year earlier, according to Moody’s Investors Service. The euro-area economy emerged from an 18-month recession in the second
quarter and the European Central Bank last week reiterated its
pledge to keep borrowing costs low.